Liberalization process started with Electricity Market Law aimed for creation of an electricity market based on transparency, integrity, and competition; and integrated with other countries’ electricity markets. In line with this aim, numerous planned steps were carried out; and significant progress has been achieved for transforming stronger and more dynamic electricity market in which market participants take an active role and market operators manage and monitor by best means.
First step carried out for transformation of electricity market from a single buyer-single seller model to liberal and competitive model was transition to monthly 3 period financial settlement system on 1 July 2006. Next step was the start of operations for Day-Ahead Planning system on 1 December 2009. These transition periods have great importance regarding to transformation of electricity market into stronger and more dynamic structure. Parties took role in market operations and activities provided significant experience and foresight for new market models from their practices at earlier market stages. 1 December 2011 date became a milestone for Turkish Electricity Market and creation of currently used Day-Ahead Market system has been established which is deemed as biggest step towards formation of targeted electricity market structure. Establishment of Day-Ahead Market stimulated a new dynamism and vision for Turkish Electricity Market and allowed formation of market structure based on values of competition.
An important aspect of Day-Ahead Market brought to electricity market is chance of demand side to adjust its consumption based on price levels. With this, demand side has begun to actively participate to market thus has the chance of hedging itself to against fluctuating price formations. Another novelty introduced by Day-Ahead Market portfolios for market participants and market participants balancing their own portfolios. This allowed participants to present more balanced structure to the market and decrease of imbalances of generation/consumption units within their respective portfolios. Participation to Day-Ahead Market is not mandatory. Another important improvement introduced by Day-Ahead Market is financial settlement in daily basis and performance of daily clearing of payables/receivables due to commercial transactions at next day after commercial transactions date. This situation allowed market participants to receive revenues generated by sales of generated electricity on daily basis rather than monthly basis thus enables them to continue their investment without cash flow concerns. Last novelty introduced is the collateral mechanism which provided insurance for receivables of electricity market and market participants against possible cash-flow problems thus mitigating effects of cash-flow problems within the market.
Novelties introduced by Day-Ahead market allowed entrance of a new era for electricity markets. With this new era, the aim is to development of electricity markets based on strong foundations and carry out essential steps for development of electricity market above these profound foundations